Mozo Rate Chasers Roundup – February 2014

This is a round-up of rates in February and some may have changed since the time of writing. To check on today’s rates click on the highlighted product.

Unless economic indicators continue to soften, the RBA is unlikely to hit the interest rates lever. While this remains the case, interest rates on loans and deposits will stay around their current levels. The Mozo Rate Chasers are still seeing some adjustments to interest rates, mostly on fixed loans, term deposits, and at call deposits, but some providers are trying different tactics to try to win your business.

Home Loans:

To get the largest cash incentive available you’ll have to be quick! As well as getting its low variable rate of 4.62%, for applications received by 6 March 2014 UBank is offering a $2,014 EFTPOS gift card when the loan reaches settlement.

St.George is offering those looking to refinance an existing loan to its Advantage Package a rebate of $1,250, available until the end of March. Teachers Mutual Bank isn’t offering cash but is waiving the $750 up-front fees for applications received by 31 May 2014.

Qantas Credit Union launched its Qantas Points Home Loan Package which has a rate of 5.18% and $299 annual fee (comparison rate 5.47%). Borrowers earn 150 Qantas points for every $1,000 loan balance per annum. This is not the first home loan to earn rewards points, Macquarie already offers Qantas Frequent Flyer points on its home loans.

loans.com.au’s dream home loan variable ‘hot summer rate’ special is the cheapest variable rate at 4.49% (comparison rate 4.51%), the best fixed rates are IMB’s 3.99% for 1 year, eMoney’s 4.65% for 2 years, and Teachers Mutual Bank’s 4.49% for 3 years.

Check out Mozo’s Home Loan Compare tool that will help you find the lowest rates for your loan amount and property value.

Credit Cards:

Purchase rates may not be changing, but that doesn’t mean card providers aren’t fighting for your business. There are currently more than 20 providers in the Mozo database with 0% balance transfer offers including ANZ, NAB, WestpacBankwest, St.George, Virgin Money, HSBC and Suncorp.

February saw the introduction of what we believe is the longest 0% balance transfer rate ever offered in Australia. Citibank won’t charge any interest on balances transferred to its Platinum card for a whole 24 months – but there’s a catch. There is a ‘handling fee’ of 3% on any balances transferred, so while the 0% may be real, it’s certainly not free. This type of offer (a long interest free period but attracting a one-off fee) has been common in the UK for a while and we suspect will become more common here too.

See all the great credit card offers along with the important fees and rates here to find a deal that suits you.

Term Deposits:

Over the last month we’ve seen more rate reductions (74) than increases (15) for terms of less than one year. For terms of one year or more it was more balanced with 20 rates decreasing and 15 increasing. This suggests that providers are not anticipating the RBA changing its interest rates policy in the near future, and if there is any movement it’s more likely to be down.

For terms of less than one year the best rate from the ‘Big 4’ is 3.25%, available from ANZ and NAB for either 3 or 7 months. That’s easily beaten by the 3.90% being offered by Suncorp and UBank for 6 months, or ME Bank for 5 months.

The best the major banks can do for a 1 year deposit is NAB’s 3.40%, but again it’s easy to find something better. A range of providers will pay 4.00% for a year including Suncorp, UBank, The Rock Building Society and Queensland Country Credit Union.

Find the best rates for a term that suits you using Mozo’s Term Deposit Compare tool.

At Call Deposits:

During February we saw some providers pulling back their introductory rate offers with the average slipping 3 basis points to 4.02%, while the average ongoing bonus rate is down only 1 basis point to 3.43%.

NAB reduced the 4 month introductory bonus rate on its iSaver account to 3.80% but left the ongoing bonus rate on its Reward Saver unchanged at 4.06%.

ANZ cut the 4 month intro rate on its Online Saver by 10 basis points to 3.90% and reduced the ongoing bonus on its progress Saver by the same amount, now paying 3.81%.

Qantas Credit Union launched its Qantas Points Saver with an interest rate of 2.50%, but also provides 400 Qantas Frequent Flyer points for every $1,000 of the average monthly balance per annum.

The best rate right now is UBank’s USaver with Ultra which pays 4.62% p.a. on balances up to $200,000. Account must be opened with a minimum $10,000 balance and deposit of at least $2,000 must be paid into the Ultra bank account each month. A close second is ME Bank’s Online Savings Account, paying an introductory rate 4.60% p.a. for 5 months up to $250,000 if linked to an Everyday Transaction Account.

Try our Savings Compare tool that makes it easy to see the conditions that can apply to special rates.

Mozo Rate Chasers Roundup – February 2014 was last modified: March 3, 2014 by Peter Marshall

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  1. From today, Greater Building Society is offering a choice of three holidays with its low rate (5.14%, comp rate 5.16%) basic (Great Rate) home loan. The holidays are to Fiji, Gold Coast and a choice of South Pacific cruises. The Greater is also waiving application fees for all home loans until the end of the financial year. http://www.greater.com.au

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